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Which of the following would most likely be a merchant with respect to the goods in
question under the UCC definition?
a. Amy is an authorized IBM computer dealer.
b. Brian employs two salesmen to sell his homemade furniture.
c. Clarence has a store in which he sells used lawn mowers.
d. All of the above would be merchants.
e. None of the above would be merchants.
Destruction of the subject matter has what effect on the offer?
a. The offer is terminated.
b. The offer is delayed until additional subject matter can be located.
c. This creates an impossibility of fact that does not terminate the offer.
d. The offer is merely delayed under the "Hardship Rule."
Clint induces David, by fraud in the inducement, to make an instrument payable to the
order of Clint. Clint then negotiates the instrument to Eric, a holder in due course, and
later reacquires it from Eric. In this case:
a. Clint is a holder in due course.
b. Clint is not a holder in due course, but he succeeds to the rights of one, because of
the shelter rule.
c. Clint does not succeed to Eric's rights as a holder in due course and remains subject
to the defense of fraud.
d. because fraud in the inducement is a real defense, it can be used against both Clint
and Eric.
Which of the following is not true regarding the contracts of incompetent persons?
a. An incompetent person is liable for necessaries.
b. Unlike a minor, an incompetent person can never ratify a contract.
c. To avoid a contract, a person need not be permanently incompetent.
d. A person is competent unless he is unable to understand the nature and effect of his
act.
Which of the following is correct with respect to finance leases?
a. A finance lease generally involves three parties instead of two.
b. A finance lessor supplies the goods.
c. The finance lessor typically has special expertise as to the goods.
d. All of the above are correct.
Which of the following is not a remedy of the buyer?
a. The buyer has the right of cover and to receive damages.
b. The buyer may have the right to obtain specific performance.
c. The buyer may have the right to recover incidental and consequential damages.
d. All of the above may be remedies of the buyer.
An instrument representing an interest in real property created to secure repayment of
the debt is called a:
a. warranty deed.
b. foreclosure.
c. mortgage.
d. default judgment.
The seller and buyer of goods agree that identification will be made by the seller when
it manufactures and separates those particular goods out for the buyer. Identification
will actually occur:
a. at the time and in the manner agreed upon by the parties.
b. according to Code Section 2-501, upon the making of the contract of sale.
c. when the buyer points out the particular goods it wants; the seller cannot identify
goods.
d. when the goods are tendered to the carrier for shipment to the buyer.
Which of the following results in a void, rather than voidable, agreement?
a. Duress by improper threat
b. Fraud in the execution
c. Fraud in the inducement
d. Undue influence
What does Article 2 say with regard to the following?
a. Good faith.
b. Unconscionability.
c. Expansion of commercial practices.
A(n) ____ imposes partnership duties and liabilities upon a nonpartner who has either
represented himself or consented to be represented as a partner.
a. accounting
b. delectus personae
c. fiduciary proceeding
d. partnership by estoppel
Under the UCC, a(n) ____ is a sequence of previous conduct between the parties to an
agreement which may be fairly regarded as establishing a common basis of
understanding for interpreting their conduct under the contract.
a. course of dealing
b. usage of trade
c. course of performance
d. integrated document
A valid contract may be unenforceable for which reason(s)?
a. Failure to satisfy the Statute of Frauds
b. Running of the Statute of Limitations
c. Both (a) and (b)
d. A valid contract is always enforceable
A foreign company partially owned by the foreign government, manufactures
televisions in the foreign country. The cost to the company for the manufacture of the
product in the U.S. is the equivalent of $100. Because of excess production, the firm
exports 5,000 sets to the United States where they are sold for $120 each. If the nearest
rival U.S.-made set sells for $150, the action of the company:
a. constitutes price-fixing.
b. violates the WTO anti-dumping provisions.
c. violates the Sherman Act, because of the involvement of the foreign government in
the company.
d. appears to be legal.
Carl and Rob are both engaged in road construction work. They know that several jobs
are going to be up for public bids, and agree between themselves that Carl will bid on
one job and Rob will bid on the other, so that they both have work for the summer.
When the bids are opened, Carl realizes that Rob has bid on both jobs. Rob is awarded
both contracts. If Carl now wants to sue Rob for breach of contract:
a. Carl would probably win on the basis of promissory estoppel since he has
detrimentally relied upon Rob's representation that he would not bid.
b. the court will likely award Carl damages since Carl is less at fault than Rob.
c. the agreement is in violation of public policy and will not be enforced by the courts.
d. the agreement obstructs the administration of justice and will not be enforced by the
courts.
Doug obtains an exclusive franchise to sell widgets for the Acme Widget Company. The
exclusive franchise covers the entire State of Wisconsin for a period of three years. In
this case:
a. Acme is obligated to use its best efforts to supply the goods even if no such clause
appears in the written franchise agreement.
b. according to the UCC, unless otherwise agreed, Doug must use his best efforts to
promote the sale of the widgets in his territory.
c. under the UCC, such an agreement lacks consideration.
d. Both (a) and (b).
The privilege against self-incrimination extends to which of the following?
a. Providing a handwriting sample.
b. Appearing in a line-up for identification purposes.
c. Taking a blood test after an accident.
d. None of the above are protected by the privilege against self-incrimination.
Knecht contracts to sell $20,000 of goods to Morales. Later, Morales hears from
another supplier that Knecht is having financial trouble, and Morales is concerned that
Knecht will not be able to fill his order. If Morales has reasonable grounds for
insecurity about Knecht's contractual performance:
a. Morales has no recourse except to wait for the contractual delivery date and, if
Knecht fails to deliver, Morales can then sue for breach of contract.
b. Morales may demand written assurance of performance from Knecht before the
contract delivery date, and Knecht must provide adequate assurance within a reasonable
time not exceeding 30 days.
c. Morales may demand assurance of performance from Knecht, and Knecht must
provide adequate assurance within ten days or the contract is repudiated.
d. the statement by the other supplier creates an anticipatory repudiation which allows
Morales to avoid the contract.
What are the debtor's duties under the Bankruptcy Code?
a. File a list of similarly situated debtors.
b. File a schedule of assets and liabilities.
c. File a statement of her financial affairs.
d. (a) and (b).
e. (b) and (c).
A debtor will be denied a Chapter 7 discharge if he or she has received a Chapter 13
discharge within the past six years:
a. unless payments under Chapter 13 totaled at least 100% of allowed unsecured claims.
b. unless payments under Chapter 13 totaled at least 70% of allowed unsecured claims
and the plan was the debtor's best effort.
c. in all events.
d. (a) and (b) are alternative exceptions to the 6-year rule.
Sarah has a checking account at First Bank. Orrin steals one of her blank checks, writes
a check for $250 to himself, and then forges Sarah's signature. Orrin then indorses the
instrument to Paul in payment of a debt. Paul presents the instrument to First Bank for
payment. At First Bank's request, Paul indorses the instrument, and the bank then pays
him $250. Which of the following is correct?
a. Paul has contractual liability on the instrument.
b. Orrin has contractual liability on the instrument.
c. Sarah has contractual liability on the instrument.
d. All of the above are correct.
e. Both (a) and (b) are correct.
An interest in property limited in duration to the life or lives of one or more persons is
known as a:
a. future interest.
b. fee simple absolute.
c. fee simple determinable.
d. life estate.
A manufacturer agrees to sell the distributor 1,000 boxes of 2-quart bowls only if he
agrees to resell to the retailer at cost plus $1.10 per bowl and the retailer must agree to
sell at no less than his cost plus .50 per bowl. This is:
a. horizontal price fixing.
b. vertical price fixing.
c. vertical market allocation.
d. a group boycott.
In a disparate treatment case,
a. if the plaintiff meets the burden of proving a prima facie case, the burden of proof
shifts to the employer.
b. an employer will not prevail in the face of a plaintiff's prima facie case unless it can
articulate legitimate, non-discriminatory reasons for its actions.
c. if a plaintiff can show that a defendant's allegedly legitimate reason for not hiring
plaintiff is merely a pretext for discrimination, the plaintiff wins.
d. All of the above.
a. What is the common law mirror image rule?
b. How does the UCC Battle of the Forms provision vary from the common law mirror
image rule?
c. In situations where the UCC Battle of the Forms provision applies and writings
exchanged between the parties differ as to terms, how are the terms of the contract
determined?
In order for a deed to be effective between the purchaser and the seller of real estate, the
deed must:
a. be in writing and signed by both parties.
b. include the actual sale price.
c. be recorded pursuant to the state statute.
d. be delivered to the buyer by the seller with the intent to transfer title.
The party to whom a contractual duty of performance is owed is known as the:
a. obligee.
b. obligor.
c. assignee.
d. assignor.
The RUPA treats a partnership as a legal entity in all but which of the following
respects?
a. Title to partnership property
b. Continuity of existence
c. Legal actions by and against the partnership
d. Unlimited liability for partnership obligations
Louis agreed to provide all the apples that Cindy's Cider Mill will need at $3 per bushel
unless weather conditions require additional labor to be hired. The rate would then be
$3.50 per bushel. A freeze warning required Louis to hire 100 additional overtime
workers, raising the cost per bushel to $4.75. Louis wants to get out of his contract. Can
he?
a. No, the parties expected the hardship and provided for it in their contract
b. No, there is no hardship
c. Yes, the contract is impracticable
d. Yes, the freeze is a supervening event
Arnold wrote a defamatory letter regarding Bill which he mailed to Bill, but which he
did not show to anyone else. Arnold has committed:
a. the tort of slander.
b. the tort of libel.
c. neither libel nor slander, because there has been no publication of the letter.
d. the tort of false light.
Claims of unequal pay for jobs of comparable worth may be brought under:
a. Title VII.
b. The Equal Pay Act.
c. OSHA.
d. Such claims may be brought under all of the above.
In which of the following situations does the seller have the right to cure?
a. Where the time for performance under the contract has not yet expired
b. After the time for performance has expired if the seller had reasonable grounds for
believing the buyer would accept a nonconforming tender with or without monetary
adjustment
c. Where the buyer has revoked acceptance
d. Both (a) and (b)
If a partner's act is not apparently for carrying on in the ordinary course the partnership
business:
a. the partnership is bound only where the partner has actual authority.
b. the third person dealing with the partner assumes the risk that the partner has actual
authority to act in such a way.
c. the partner is necessarily acting without authority.
d. Both (a) and (b).
An employer:
a. must not provide electronic bulletin boards and chat rooms because of provisions of
the CDA.
b. should act quickly to remove any defamatory statements brought to its attention
because Section 230 of the CDA grants immunity from defamation liability only to
ISPs.
c. need not be concerned about allegedly defamatory statements on e-forums it controls
because Section 230 of the CDA grants any employers immunity from liability for
defamation for publishing information originating from a third party.
d. cannot be held liable for unauthorized online defamatory statements made by
employees.
An obligation imposed by law where there has been no agreement or expression of
assent by word or act on the part of either party involved is a(n):
a. implied in fact contract.
b. express contract.
c. void contract.
d. quasi contract.
A trustee under a Chapter 11 or 13 proceeding performs the same duties as a Chapter 7
trustee.
Past actions unbargained for by the parties in an agreement can become valid
consideration for a contract.
An agreement to sell the entire production of a particular plant to a particular purchaser
is a requirements contract.
A contract to commit a tort will be enforced by the courts.
Where a stipulation in restraint of trade is a part of the contract for the sale of a
business, it may be valid if the restraint is within reasonable limitations to protect the
business's goodwill.
On Monday, Bill agreed to buy aluminum siding for his home from Al, a door-to-door
salesman. On Friday, he can rescind the contract with no liability for breach of contract.
Under the CISG, the aggrieved party in a breach of contract has no duty to mitigate the
loss.
A holder in due course has the same rights under a consumer credit contract as under
the UCC as long as a special notice requirement has been met.
A document of title symbolizes ownership of the goods it describes; its transfer
transfers the ownership or control of the goods without necessitating the physical
transfer of the goods themselves.
All depositary institutions are required to disclose APY earned and balance information,
including how the balance is calculated, on the periodic statements they must send to
customers.
Directors usually may vote by proxy when they are not able to be present for a meeting.
Compare the remedies of withholding delivery of the goods and stopping delivery of
the goods. How are they alike? How are they different?
Revised Article 3 adopts a definition of good faith that has both a subjective and an
objective component.
If a witness dies prior to the death of the testator, his signature is not counted as a
witness unless proof of his handwriting is submitted.
Specific performance is a remedy at law which seeks to compel the party in breach to
perform the contract according to its terms.
An author may terminate transfer of copyright ownership, other than that of a work for
hire, during the five-year period beginning 35 years after the transfer was granted.
